Economy

June home sales spark talk that housing recession is easing

Surprising numbers on new home sales opened the door to talk Monday that the housing market is finally beginning to gain strength.

Nationally, new home sales surged 11 percent in June when compared with May, the U.S. Commerce Department said. That was the biggest monthly jump in eight years and far surpassed predictions.

“The worst of the housing recession is now behind us,” said David Resler, chief economist at Nomura Securities. As with the overall economy, the “recovery” is likely to be slow and arduous, he said.

Economists said the nationwide increase was spurred by a drop in prices and a rush by consumers to take advantage of a new first-time homebuyers’ federal tax credit.

The national median price of a new home fell 12 percent to $206,200 when compared with June 2008, the Commerce Department said. The median price was $219,000 in May.

Nationwide, sales increased to a 384,000 annual pace, higher than any forecast of economists surveyed by Bloomberg News and the most since November, the Commerce Department figures showed.

Economists forecast that new home sales would rise to a 352,000 annual pace, according to the median of 62 projections conducted by Bloomberg.

Read the full story at KansasCity.com

  Comments